#coronavirus Job Retention Scheme and Self Employed Income Support Scheme update – 21st June 2020

The Coronavirus Job Retention Scheme Part 1 is soon coming to an end on 30th June 2020. Announced by the Chancellor of the Exchequer on Friday 20th March 2020, the Scheme covered from 1st March through 30th June for those who were furloughed for a minimum period of 21 consecutive days.

The last new furlough employees (excepting parental leave and reservist returners) was 10th June 2020.

The latest stats

At midnight 21st June 2020:

  • The number of jobs furloughed was 9.2 million
  • Number of employers furloughing was 1.1 million
  • Total grant payments £22.9 billion

Under the Self-Employment Income Support Scheme

  • 2.6 million claims
  • £7.6 billion claimed

Furlough fraud!

Research by Crossland Employment Solicitors who surveyed 2,000 respondents indicates that 34% of employees have been asked by their managers to work during furlough.

Law is being progressed through Parliament to combat fraud. It gives HMRC powers to charge a penalty where a person deliberately makes an incorrect claim for a SEISS or CJRS payment. It also gives HMRC powers to charge a penalty where a person who has claimed a CJRS payment deliberately does not use it for the costs it was intended to reimburse. The penalty will only apply if the person fails to notify HMRC about the situation within 30 days, or 30 days after the Finance Bill receives Royal Assent if it arose before that.

It also gives HMRC powers to make a company officer jointly and severally liable for the Income Tax charge raised in relation to any CJRS payment to which the company was not entitled or any CJRS payment which was never intended to be used to pay furloughed employee costs in certain circumstances. Those circumstances are where the officer is culpable for making a deliberate CJRS claim to which the company was not entitled.

Opinion

The #Coronavirus #COVID19 pandemic has brought unprecedented time to the U.K. and world economies affecting employment and families.

1 in 3 individuals has been contacted by scammers who have seen the pandemic as an opportunity for successful crime. Some businesses may also seen the various support programs as an opportunity to play the system, whether deliberate profiteering or desperate survival measures.

However, the rules and circumstances have been difficult and complex, with numerous variants applied to guidance. The required calculations and circumstances are complex and some genuine mistakes will have been made. For example, salary sacrifice arrangements are little understood with many employers considering them to be tax free deduction when that facility does not exist. Furlough pay covered by the government grant cannot be sacrificed (deducted for the provision of benefits) as the basis is on post sacrifice pay declared as income.

Employers need to verify their CJRS claims to ensure accuracy and that no fraud has been committed. Take corrective action where needed.

We are now about to enter the next phase (part 2) of fully flexible furlough for those employee groups that both qualify and where employers need the added flexibility as we get Britain back to work and keep Britain paid.

PAYadvice.UK 23/6/2020

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